2025-26 Saskatchewan Provincial Budget

The 2025-26 Saskatchewan Provincial Budget introduces several changes that could impact you from a tax, accounting, or personal finances perspective. Here’s an overview:

1. Personal Income Tax Adjustments:

• Enhanced Personal Exemptions: The Basic Personal Exemption, Spousal and Equivalent-to-Spouse Exemption, Dependent Child Exemption, and the Seniors Supplement will each increase by $500 per year for the next four years. This represents the largest personal income tax reduction in Saskatchewan since 2008.
• Disability and Caregiver Tax Credit Increase: The Disability Tax Credit and Caregiver Tax Credit amounts will increase by 25% to provide additional financial support.
• Income Assistance Increase: Monthly benefits for Saskatchewan Income Support (SIS) and Saskatchewan Assured Income for Disability (SAID) clients will rise by 2%.
• Expanded Active Families Benefit: This refundable tax credit, which helps families afford children’s sports, arts, cultural, and recreational activities, will double from $150 to $300 per child. Additionally, the income threshold to qualify will increase to $120,000, making more families eligible.
• Reinstated Home Renovation Tax Credit: The Home Renovation Tax Credit is reinstated, allowing homeowners to claim a non-refundable tax credit on eligible home renovation expenses of up to $4,000 annually on their primary residences, resulting in a maximum benefit of $420 annually. Seniors can claim an additional $1,000, for a maximum benefit of $525 annually.
• Graduate Retention Program Expansion: Graduates will see a 20% increase in benefits, raising the maximum retention credit to $24,000 to encourage post-secondary graduates to remain in Saskatchewan.

2. Corporate Income Tax Adjustments:

• Small Business Tax Rate Maintained at 1%: The government has permanently set the small business tax rate at 1%, benefiting over 35,000 small businesses and saving them more than $50 million annually in corporate income taxes.

3. Education Property Tax Mill Rates:

• Reduction in Mill Rates: To offset increased property assessment values and maintain revenue neutrality, all education property tax mill rates will be reduced effective January 1, 2025. The new rates are:
  • Agriculture: 1.07 (down from 1.42)
  • Residential: 4.27 (down from 4.54)
  • Commercial/Industrial: 6.37 (down from 6.86)
  • Resource: 7.49 (down from 9.88)

This adjustment is expected to save property owners over $100 million annually.

4. First-Time Homebuyers Tax Credit:

• Increase in Maximum Benefit: Effective October 1, 2024, the maximum benefit for the Saskatchewan First-Time Homebuyers Tax Credit increases by 50%, from $10,000 to $15,000 for eligible home purchases. This change raises the maximum benefit for an individual from $1,050 to $1,575.

5. Class 1 Truck Driver Training Rebate:

• Introduction of Training Rebate: A new rebate program is introduced for individuals seeking a Class 1 commercial driving licence, aiming to support the trucking industry and address driver shortages.

6. Other Measures:

• Carbon Tax Exemption on Home Heating: The provincial government has extended its exemption on the carbon tax for home heating, projected to save the average Saskatchewan household approximately $480 in 2025.

Clients are encouraged to contact your Stark & Marsh advisor to understand how these changes may impact their individual financial situations and tax planning strategies.

Source: Saskchewan.ca